Finance ministry scrambles to work out tax filing delay

MISCOMMUNICATION After President Chen Shui-bian announced a tax extension for everyone, the MOF said the extension was only for medical workers

By Joyce Huang and Lin Chieh-yu / STAFF REPORTERS

A surprise suggestion yesterday from President Chen Shui-bian (陳水扁) about extending the June 2 deadline for filing last year's tax returns left Minister of Finance Lin Chuan (林全) scrambling for a solution that would get taxes paid as soon as possible, yet follow the spirit of Chen's proposal.

During a videoconference with Premier Yu Shyi-kun, Vice Premier Lin Hsin-i (林信義), the head of the Cabinet's anti-SARS task force Lee Ming-liang (李明亮) and Department of Health Director General Chen Chien-jen (陳建仁) yesterday morning, Chen blurted out the idea of extending the filing deadline by one month.

"As the epidemic has seriously affected daily life, many people have asked if the government could extend the filing deadline by one month," Chen said

He said such an extension should apply to those "experiencing difficulties due to SARS."

That could have conceivably opened the proposal up to include most businesses and their employees, including airlines, high-tech firms, retailers and travel agencies.

"The government has to do something to prevent complaints," Chen said, noting that more than 80 percent of taxpayers have not yet filed their returns.

He then instructed Yu to have the Ministry of Finance work out a plan.

Lin came up with a proposal to help those on the front lines of the SARS battle.

"We've decided to endorse the president's proposal by offering medical staffers a one-month delay in filing their taxes," Lin said at a press conference late yesterday.

But offering a nationwide extension was out of the question, Lin said. He said the treasury would encounter liquidity problems if the one-month extension applied to all 4.8 million taxpayers or businesses.

"The government's financial condition may worsen if revenues from personal and business income taxes, which total NT$160 billion, are not paid on time," he said.

According to Lin, the Department of Health will provide a list of medical staff from the central and local governments involved in the anti-SARS effort. Only these people will be able to put off filing their taxes until the end of June.

"Only those who are engaged in taking care of SARS patients or helping with the government's anti-SARS measures will be on the list," Lin said.

A public finance professor at National Chengchi University said the half-baked idea was indicative of Chen Shui-bian's policy-making process.

Chen's leadership style of tossing out random ideas without first consulting his economic team has obstructed the formulation of unified and effective financial and economic policies, Tseng Chu-wei (曾巨威) said.

"What we often see from the president's policy-making process is uncertainty and inconsistency, which ends up reducing the public's confidence," Tseng said.